Reports Music

Virtual Concerts - A New Video Format

Report by Mark Mulligan
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The 20,000 Foot View: The global pandemic thrust the live music sector into chaos, with global revenues falling by XXX in 2020 compared to one year previously. The music industry was rocked by first-order impacts (no concerts, no fan engagement) and second-order impacts (many artists realising that streaming did not add up without live income alongside it). Necessity, though, is the mother of invention and an unprecedented period of innovation and experimentation followed, creating a whole new virtual concert ecosystem. One that presents great opportunity but that also reflects the flaws of a hastily constructed industry, flaws that must be fixed for the sector to realise its ambition. Rather than the future of live, virtual concerts represent an entire new video product strategy.

Key Insights

  • The XXX pandemic thrust global live music revenues down by XXX from XXX billion in 2019 to XXX billion in 2020, disrupting artist income, in turn highlighting artist and songwriter discontents with streaming royalties
  • Virtual events were kickstarted by the pandemic, with XXX million streams of virtual concerts in 2020 and with XXX of consumers regularly viewing live streams, albeit still less than half of the XXX that used to regularly attend real world concerts
  • Live streaming quickly transitioned from free to paid, with Bandsintown reporting the number of paid live-streamed concerts posted on its platform up from XXX in XXX 2020 to XXX by end November 2020
  • Live streamed concert viewers are younger than traditional concert goers and more likely to be male XXX compared to XXX streaming was driven by a quantum leap in artist demand; home-bound consumers with XXX more time; a wider shift to streaming; and a widespread consumer desire to be connected
  • The virtual concert value chain is defined by fragmentation and a vast array of companies trying to own as much of the value chain as possible 
  • Live streaming needs more consistency and structure, with a strong case for a circuit of virtual venues, sophisticated monetisation and a distribution ecosystem
  • Live streaming represents a new video format that could be to live music what TV is to sports: a lucrative, global, hybrid licensing / pay per view
  • Ticketed live-streamed concerts generated XXX billion in 2020, which will grow to XXX billion in 2021 XXX of all live revenues) and will reach XXX billion in 2027
  • The outlook for virtual events will be defined by: contributing to diversified artist income; filling the small venue gap for emerging artists; delineating traditional artists from streaming artists; format and business evolution; and new games models

Companies and brands mentioned in this report: Amazon, Driift, Epic Games, Fortnite, Facebook, MelodyVR, Minecraft, Sessions, Twitch, YouTube

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